AI Stocks Rally Amid Bond Yield Concerns

Global markets have settled into a fragile calm, but concerns about bond yields, energy prices, and political pressure could quickly revive investor anxiety.

Rising U.S. Treasury yields threatened to spoil the positive mood in equity markets, where AI stocks are rallying thanks to strong quarterly reports from companies linked to artificial intelligence development.

However, following July's U.S. inflation data, tensions eased somewhat as consumer and producer price figures proved less alarming than market participants had feared.

The Federal Reserve now has more reason not to rush into raising interest rates as early as September, with futures markets lowering their estimate of the likelihood of a rate hike to roughly one-third.